The shift in retail to the east side of Grand Rapids reflects broader market trends
GRAND RAPIDS – The retail corridors on the east side of Grand Rapids are in flux as new businesses move in and long-time staples move or close.
The East Hills and Eastown corridors epitomize West Michigan’s hot commercial and retail real estate market, characterized by low vacancy rates and low land values and rental rates croissants.
Real estate trends are having a direct effect on retail shifts recently seen in Eastown and East Hills, small business neighborhoods surrounded by an equally hot residential market, said Ingrid Miller, executive director of Downtown Grand Rapids Inc..
“What we’re seeing on a public level are the visible results of a much more complex business ecosystem,” Miller said.
Market forces at play have led some long-time business owners to retire by retiring or selling their property, while other business owners have been pushed out of desirable retail locations due to from rising rents or other market conditions caused by the pandemic.
“There has been an increase in demand in the face of limited supply in the commercial real estate market, similar to the housing market,” Miller said. “Being a neighborhood business district and almost all locally owned minus a few chains that are still franchised locally, people talk to each other. If you’re ready to sell, there’s usually a “let me know first” conversation you have with neighboring business owners. »
Paul Lee, co-owner All In Hospitality Group LLC, who operates Donkey, Hancock, Winchester and Royalssaid the pandemic has taken its toll on some longtime operators.
“A lot of these small business owners have had the option of cashing out or letting others take over,” Lee said. “I think that’s what you see as a big part of this change. Some of the other changes are that things have really changed over the past two years with the way we go out and dine.
Closing longtime staples
Brick Road Pizza Co., which closed in January after 13 years in business on Wealthy Street, was barely holding up during the pandemic, co-owner Cindy Talbert said. in January. The business was created for restaurant customers, which poses a major challenge as restaurant capacities have shrunk and customers have preferred takeout. It was also difficult to maintain staffing levels and pay rent for the large space, which also contributed to the restaurant’s closure, Talbert said.
Big Bad Wolf Grand Rapids LLCwhich is registered with Electric Cheetah Owner Cory DeMint is in the process of applying for a liquor license at Brick Road Pizza’s former location at 1017 Wealthy St. SE, according to Michigan Liquor Control Board deposits. Electric Cheetah is located on the same block as the old Brick Road.
Cory DeMint did not respond to requests for comment. A Facebook page titled The Big Bad Wolf posted on March 17 that a Mediterranean/Polynesian/vegetarian restaurant and bar is opening in the former pizzeria.
Other notable recent closures of long-standing businesses in Eastown and East Hills include Cherry Deli and Catering, Moose brewing, Easttown Antiques and Bluedoor: a collective for the home antique store.
Jason and Kate McClearen, owners of The boss and the everyday wifebought the building at 834 Cherry St. SE on July 15 for $640,000 from former Cherry Deli owner Scott Schulz.
“We were lucky enough to meet the former owner of Cherry Deli,” said Jason McClearen. “He was thrilled to pass the torch and was thrilled that it was in some ways the same mission that (Cherry Deli) had.”
The location appealed to the couple as it is close to downtown Grand Rapids in a visible and popular retail corridor.
“We’re really excited to find this location,” said Jason McClearen. “We loved Cherry Deli when it was here, and we just want to reinforce what the neighbors are doing and share our idea at the same time.”
Miller, of Uptown Grand Rapids Inc., said a “sense of grief” usually follows the closure of a longtime community business.
“Cherry Deli is one of those losses that everyone mourns,” Miller said. “Businesses like this are friendly faces, but they’re also a big part of the neighborhood and they make Uptown appealing. In a way, it was these primordial places that attracted other companies. There is definitely a sense of loss, but then understanding that there are only business cycles. Twenty years ago, the neighborhood was very different. Today we have fewer vacancies and there is a lot of demand.
Retail space in West Michigan has an overall vacancy rate of 3%, with popular retail corridors seeing the highest sales volume over the past year, according to International Necklaces‘s 2022 Q2 Grand Rapids Retail Market Report. Currently, 180,000 square feet of retail space is under construction in West Michigan, which is “small enough not to impact vacancy rates and rental growth,” says The report.
The average rental rate in the Uptown business district — which includes Eastown, East Hills and the East Fulton business district — has been rising and is steadily around $20 to $25 per square foot, research shows. recent run by Uptown Grand Rapids Inc. were listed at $30 to $34 per square foot, which is the highest the district has ever seen, Miller said.
“We’re happy to see the improvements and what it looks like and expect a certain amount of property value to go up, but we’re also aware that rental rates are going up,” Miller said.
Uptown Grand Rapids tries to work with landlords to communicate the benefits of longer-term leases that gradually increase rent over the years, rather than steep increases in short-term leases, Miller said.
“Our businesses are enjoying the benefits of revitalization,” Miller said. “There are more people walking around. This gives a boost to sales and, at the same time, the value of their properties increases. This has given long-time landlords the opportunity to exit while their property value is at an all-time high, which in some cases has created adverse circumstances for their other tenants who may experience increased rental rates. .
Eastown Antiques and Blue Door: A Home Collective, formerly located on East Fulton Street, closed recently after a change in ownership of their respective buildings.
Blue Door: A Home Collective announced on Facebook on June 27 that its building had been sold and the business had closed in August.
“We would like to thank all of our loyal friends for supporting us and all of our valued vendors who have been part of Blue Door,” the post reads.
Dean Wiers-Windermuller owns Riverside Guitar School in Eastown and recently purchased his building at 1515 Lake Drive SE to expand his business. Weirs-Windermuller bought the nearly 5,000-square-foot, 102-year-old building for $920,000, property records show. The acquisition ended up displacing Eastown Antiques after the two parties were unable to agree a new lease, according to Weirs-Windermuller.
“Eastown Antiques was here for 17 years and my business has been here for seven years,” Weirs-Windermuller said. “They were always good neighbors and had a good reputation. I did what I could to work with them to try to keep them in the front end of the space but ultimately they decided it was best to close and now focus on the selling side of their business .